Holding property through a corporation is a common strategy for tax planning, liability protection, or succession planning reasons.
However, this structure introduces an additional layer of complexity, when determining how the right of survivorship applies when a joint tenant is a corporation. Unlike a natural person, a corporation does not “die” in the same way as an individual does. A corporation’s existence ends through the process of dissolution, but that process is not always final as a corporation may be revived under Ontario law.
The right of survivorship is available only when property is held by joint tenants. It does not affect the other form of joint ownership in Ontario known as tenants-in-common. The right of survivorship is what makes joint tenancy a unique and often useful tool in estate planning if properly documented. It can be used to minimize disputes among beneficiaries, simplify the probate process and reduce or avoid estate administration tax (probate fees).
For example, if A and B own property as joint tenants, in the absence of certain implied trusts, upon A’s death, A’s interest does not form part of A’s estate. Instead, A’s interest passes automatically to B through the right of survivorship. A’s interest in the property does not pass through A’s estate and is not subject to probate and no estate administration tax is payable on that asset.
The right of survivorship is a common law concept that has been recognized by Ontario Courts and incorporated into various Ontario statues. The Land Titles Act, R.S.O. 1990, c. L.-5 acknowledges that owners of land, who are registered as joint tenants, enjoy a right of survivorship and upon the death of an owner the land registrar may remove the deceased owner from title.
The concept of survivorship applies not only to land but also to other forms of jointly held property. Such interaction between the common law and statues was reviewed in Gruber v. Glickman Estate et al., 2025 ONSC 258 (CanLII) (“Gruber v. Glickman”). The Court was asked to decide as to the ownership of shares held by separated spouses where there was no indication whether the shares were held as tenants in common or as joint tenants. According to the common law principle a joint tenancy existed when two or more individuals own real or personal property, without clear intentions otherwise. However, the Court went further to examine how the Courts of Equity interpreted joint ownership when there was lack of clear intention. The Courts of Equity favoured a determination of tenants in common, resulting in no right of survivorship being applied.
The Court of Equity’s interpretation was adopted in Ontario and later codified in s. 13(1) of the Conveyancing and Law of Property Act, R.S.O. 1990, c. C.34 (the “CLPA”), which provides that, unless a contrary intention clearly appears, a conveyance of land creates a tenancy in common rather than a joint tenancy.
In Gruber v. Glickman, the Court held that shares were not a conveyance of land and therefore the CLPA did not apply. As such, the Court applied common law principles and determined that the shares were held as joint tenants.
Another factor addressed by the Court is the presumption of a resulting trust (a form of implied trust). The law assumes that when a gratuitous gift is given the person who made the transfer nevertheless did not intend to make a gift, and therefore the recipient is holding the property in trust for the transferor (or for the transferor’s estate when they die).
As the two individuals in Gruber v. Glickman were separated spouses, the Court also looked to section 14 of the Family Law Act, R.S.O. 1990, c. F.3, which says that when property is held in the name of spouses as joint tenants then there is an intention to own the property as joint tenants and, in the absence of evidence to the contrary, the presumption of resulting trust does not apply. Section 14 of the Family Law Act does not apply to common law spouses.
The Court determined that the principle of the resulting trust in that case did not apply. The shares were held in joint tenancy and were therefore transferred by the right of survivorship.
As an aside, if the intention is for the gifted interest in property to pass by right of survivorship, the donor should obtain independent legal advice to ensure they understand the consequences of the transfer and their intentions should then be clearly documented. That documentation can provide the necessary evidence to uphold or rebut the presumptions.
In the decision of Jackson v Rosenberg, (2024 ONCA 875) the Court looked at the use of joint tenancy as an estate administration tool. The Court in this case applied the presumption of resulting trust. It also highlighted the risk of joint tenancy as an estate planning tool to avoid estate administration tax.
Mr. Jackson gratuitously transferred his home to his late partner’s niece, Ms. Rosenberg, as a joint tenant as part of his estate plan. Upon his death, the house would transfer by survivorship to Ms. Rosenberg thereby avoiding probate fees. After several years, Ms. Rosenberg and her spouse made it known to Mr. Jackson that they intended to sell his home. He severed his joint tenancy to limit Ms. Roseburg entitlement to the home. His intention had been to gift to Ms. Roseburg only the right of survivorship – meaning that he intended to retain the beneficial ownership throughout his lifetime.
The Court of Appeal found that Mr. Jackson was able to gift the right of survivorship subject to a resulting trust during his lifetime. While a gift cannot be “ungifted”, the severance of the joint tenancy (which can be done unilaterally) in turn creating a tenancy-in-common, could be done. The result of the decision was that when Mr. Jackson severed the joint tenancy, he and Ms. Rosenberg each held a 50% tenancy-in-common interest. However, Ms. Rosenberg’s tenancy-in-common interest remained subject to the resulting trust in favour of Mr. Jackson during his lifetime. Her only interest in the property was to receive a 50% interest following Mr. Jackson’s death if he does nothing to dispose of the property during his lifetime.
The risks of adding a joint tenant are not limited to the loss of control by the transferor. The addition of the new joint tenant can also expose the property or asset to creditor claims of the transferee, and can result in income tax (capital gains) complications.
In Pecore v. Pecore, 2007 SCC 17, 1 SCR 785, a parent added his child on a joint account as part of his estate planning process to avoid probate fees. The court decided that in the absence of proof that a gift was intended, there is a presumption of a resulting trust, and the addition of the child was done not to gift directly to the child but for estate administration purposes. The presumption of resulting trust means that a gift may not pass automatically by right of survivorship.
Because survivorship is a mechanism that operates upon death, questions arise as to whether a corporation can own property as a joint tenant, and if and how survivorship can ever be “triggered” in respect of a corporation.
A corporation is expressly treated in like manner as an individual when holding real or personal property in joint tenancy, including where both, or all, corporations hold as joint tenants, by reason of section 43 of the CLPA. The CLPA also provides that property owned by a corporation as a joint tenant devolves on the surviving joint tenant on the dissolution of the corporation. Dissolution appears therefore to be treated as the “death” of a corporation for survivorship purposes. A solicitor who wishes to register a standard form of survivorship application on real property may need to contact the Land Registry Office for assistance in preparing and registering the application, as it contains inapplicable and inappropriate provisions, such as a reference to the “deceased”. Also, as corporations may be revived by obtaining articles of revival (see in particular section 241 of the Business Corporations Act R.S.O. 1990, c. B.16 (the “OBCA”), for example it is unclear whether a revived corporation may be able to reacquire ownership of real property. Instruments registered on title in the interim create obvious complications. Articles of revival under the OBCA may be filed as late as 20 years following involuntary dissolution (that is, dissolution by administrative action) but may not be revived where the dissolution was voluntary (that is, where articles of dissolution were filed) except by special Act of the Legislature.
The authors would like to thank Alan Kay for his valuable input and guidance.